Santander agrees £350m deal for majority stake in Ebury

Santander has announced a £350m investment in trade and foreign exchange facilitator for small and medium-sized companies, Ebury.

Coinciding with the banks digital strategy of accelerating growth through new ventures, the investment is said to support its vision of being “bank of choice for SMEs.”

Ana Botín, group executive chairman of Banco Santander, commented: “Small and medium-sized businesses are a major engine of growth around the world, creating new jobs and contributing up to 60% of total employment and up to 40% of national GDP in emerging economies. 

“SMEs are becoming increasingly global and Santander is the best positioned bank to play a leading role to help them access global trade finance.”

UK-based Ebury operates across 19 countries and 140 currencies, averaging an annual revenue growth of 40% in the last three years. 

Under the terms of the agreement, Santander will acquire 50.1% of Ebury for £350m, of which £70m will be new primary equity to support Ebury’s plans to enter new markets in Latin America and Asia.

“By partnering with Ebury, Santander will deliver faster and more efficient products and services for SMEs, previously only accessible to larger corporates,” concluded Botin. 

Santander currently serves more than four million SME clients worldwide, of which more than 200,000 do international business. 

The deal will enable Ebury to improve its services as well as establish new partnerships and Santander said it expects a return on invested capital (RoIC) “higher than 25% in 2024.”

In 2018, the company processed £16.7 billion in payments for their 43,000 clients. It will continue operating as an independent unit with the addition of Sergio Rial (Santander Brasil’s CEO) as chairman.

Juan Lobato and Salvador García, co-founders of Ebury, added: “Combining a big bank with nimble fintech means we can offer our clients the best of both worlds: they can benefit from our technology and high quality service safe in the knowledge that they are counterparty to one of the world most important financial institutions.

“It is an exciting time for Ebury, we have just completed our first acquisition, and the new capital from Santander and our existing shareholders will allow us to invest in new ways to serve SMEs trading internationally and continue the growth in our business while keeping our entrepreneurial culture.”